$2.5 Billion Sent Out of Iran to Purchase Cryptocurrencies

The chairman of the economic committee of Iran’s parliament has revealed that Iranians have sent more than $2.5 billion out of the country to purchase cryptocurrencies with. His statement follows the country’s central bank banning local banks from dealing with digital currencies including bitcoin.

$2.5 Billion Capital Flight

Mohammad Reza Pourebrahimi, the Chairman of the Economic Commission of the Parliament of Iran, was quoted saying last week by Ibena.ir news agency:

Based on the existing data, few people in Iran are cryptocurrency users and more than 2.5 billion dollars has been sent out of the country for buying digital currencies.

Central Bank of Iran building.

He previously told Isna newspaper that Iranians had transferred $30 billion out of the country over the few months ending March. “Iranians do not have access to the international banking system and the transfers can only occur through unconventional ways, such as exchange dealers or international travelers,” Radiofarda explained.

The chairman’s statement came on the heels of the Central Bank of Iran (CBI) banning banks and financial institutions from dealing with cryptocurrencies, citing money laundering and terrorism financing risks.

Iran’s National Cryptocurrency

Iran’s Information and Communications Technology (ICT) Minister, Mohammad Javad Azari-Jahromi, recently confirmed that an experimental local cryptocurrency has been developed and a test model was ready.

However, in an interview with Ibena.ir last week, Pourebrahimi said that “No virtual national currency has been designed in the country at the present [time].”

Nonetheless, he explained that Iran’s national crypto can “facilitate economic deals and circumvent sanctions,” the news outlet conveyed. Citing that “the future of the world economy will be done on digital currencies,” the chairman was quoted asserting that the national cryptocurrency “can pave the path for multilateral currency swap agreements between Iran and countries which are enthusiastic to have economic cooperation with Iran but they couldn’t have it so far owing to the sanctions.” He also elaborated:

The structure of the cryptocurrency should be suitable for economic activity and be acceptable at the international level simultaneously.

Pourebrahimi believes one of the benefits of cryptocurrencies “is [the] absence of [the] American regulator,” which he admitted can circumvent sanctions. His statement echoes Azari-Jahromi’s statement made last week that “All cryptocurrencies have the ability to circumvent sanctions because they are not under the supervision of the US financial regulator.”

Meanwhile, U.S. President Donald Trump has withdrawn the US from the 2015 Iran nuclear deal by restoring sanctions on Iranian oil exports.

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